Our estate planning clients often ask, “Am I ever going to have to re-do these documents?” The legal answer is that the documents we prepare will always be valid—they don’t get “stale” or invalid after a period of time. The reality, however, is that life happens—babies are born, loved ones pass away, people get married, people retire—and these changes affect what you want your estate plan to say. Your primary goals often change over time. Earlier in life your main concern may be ensuring that someone is appointed to care for your children if something happens to you. The older you get, the more important asset protection becomes. Because life changes are inevitable it’s important to occasionally re-examine your estate plan to make sure that it still meets your goals and wishes.
Below are seven key times to re-examine your estate plan:
1) Every ten years. Although there’s not a set time you have to review your estate plan, every ten years is usually a good milestone to use.
2) Marriage. People often don’t realize that when you get married your spouse doesn’t automatically become the beneficiary of your assets or automatically have authority to assist you with business and health decisions if you become incapacitated. This is a good time to set out a plan that says who you want to assist you if you’re unable to take care of your own affairs and to specify how you want your property distributed when you die.
3) Birth. When you have a new baby it’s a good time to consider who you want to take care of your child and manage your child’s inherited assets in case something happens to you.
4) Divorce. In most cases, your estate plan will not automatically change when you get a divorce. If you don’t want your ex-spouse handling your affairs or inheriting your assets, you should modify your estate plan in case of divorce.
5) Death. If someone named in your estate plan passes away you may need to consider changes that need to be made to your plan.
6) Decrease in level of function. If your health is declining and you need more assistance you may need a plan to protect your assets for the future need of long-term care or advice for how you can receive benefits to help pay for care at that time.
7) Serious health event. If you or your spouse receives a bad diagnosis you need to make sure you have a plan in place. You should ensure you have the right person in charge of making decisions for you if you’re unable to make them for yourself. You may also need to consider asset protection and how to get benefits to help pay for your care.